The articles of an unlimited company

(a) The articles of an unlimited company; should state the number of
members with which the company is to be registered, and if it has a share capital, the amount of share capital with which it is’ to be registered Sec. 27
(1)].
(b) The Articles of a company limited by guarantee must state the number of members with which the company is to be registered Sec. 27 (2)].
(c) The Articles of a private company having a share capital must contain the four restrictions as given in Sec. 3 (1) (iii) of the Companies Act namely
(i) restriction on the right of the members to transfer shares;
(ii) limitation of the number of its members to fifty. (For this purpose past and present employee of the company may be excluded; joint
lion dears of shares shall be treated as one member).
(i ii) prohibition of any invitation to the public to subscribe for any shares in or debentures of, the company; and
(iv) prohibition of invitation on acceptance of deposits from the public.
(d) In the case of a private company not having share capital, the Articles need not contain the sub-clause (i) above, but must contain the other three
sub-clauses i.e. sub-clauses (ii), (iii) and (i1') above. Indicate the relation between Memorandum of Association and Calicles of Association. .
Ans. The relationship between the Memorandum and articles of Association of a company is that the Articles of Association is subordinate to the
Memorandum of Association. Ties relation between these two documents is evident from the following points:
1. The Articles rank next after the Memorandum. The Memorandum of Association is the charter which defines tube institution of a company. It is the
dominant instrument which Jays down the conditions of incorporation and defines the scope and power of the company. On the other hand.